Central Bank: Foreign Investments in Egypt Declined

Egypt’s Central bank issued a report about direct foreign investment in Egypt declining to its lowest level in seven years at the end of the financial year of 2010-2011. Reports estimate the decline at U.S. $2.2 billion. The report said direct foreign investments made a record back in the financial year 2007-2008, an estimate of U.S. $13.2 billion before the outbreak of the global financial crisis. It affected the size of foreign investment in the successive financial year at an estimated U.S. $8.1 billion.

These investments witnessed a development in negative value for the first time in history during the next financial year, an estimated U.S. $163.6 million at the end of the last financial year. They were affected by the political incidents that took place in Egypt. The investments returned and achieved a U.S. $99 million in positive development in the end of the financial year, which ended in June.

The manager of the financial institutions of the international Arab African Bank Mohsen Rashad said this decline is a result of the negative repercussions of the Egyptian January 25 revolution. The foreign investor studied the local market before starting their investments.

Rashad also said the investment climate is ruled by certain factors such as tax legislations, accessibility to the money retrieval, labor cost and political stability. He emphasized these factors must be provided to launch investments and enhance economical performance.